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Reliance Industries Ltd.
Good news in E&P – discoveries
in 2 new blocks since April
„First discoveries in new eastern offshore blocks since 2008
Hardy Oil, partner of Reliance Industries (RIL) in deepwater block KG D9, has
reported the first gas discovery in KG D9. Its commerciality is being ascertained. In
April 2011, RIL had also reported a gas and condensate discovery in the first well
drilled in deepwater block CY-PR-DWN-2001/3 (Cauvery-Palar basin). These are
RIL’s first discoveries in new blocks in the eastern offshore region since February
2008 (KG D3). If these discoveries prove to be commercial and significant in size, it
will help re-rate RIL’s E&P. RIL has 22 blocks in the eastern offshore region. It has
now drilled in 10 and made discoveries in 9. The first well in Mahanadi D4 (reserve
potential 100tcf) may be drilled in FY12. We retain our Buy rating.
Discovery just 7% of risked prospective resources in KG D9
The initial estimate of unrisked prospective resources in KG D9 was 54.8tcf
(risked 10.6tcf). After the first well drilled in Oct. 2009 was dry, the independent
expert-certified prospective resources estimate was cut to 29.5tcf (risked 5.2tcf).
After the second unsuccessful well in January 2011, estimates were further cut to
27.6tcf (risked 4.7tcf). The successful well is in a prospect (A2) that accounts for
just 7% (345bcf) of the risked prospective resources of 4.7tcf in KG D9.
Clarity on KG D6 2P reserve cut soon; 2C may rise
On June 13, Niko Resources (Niko) said that its 2P reserves had been cut by 18%
(no asset wise break-up). Clarity is expected on June 24. We have already cut 2P
reserves in KG D6 by 600bcfe, but the worst-case cut could be 2.7tcfe. The
impact of the cut on RIL’s NPV would be relatively low, as, at peak, the govt’s
share of profit petroleum in KG D6 is 85%. Also, 2C contingent resources (7.2tcf)
in KG D6 may rise, as the 2C number reflects only 14 of the 20 discoveries made.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Reliance Industries Ltd.
Good news in E&P – discoveries
in 2 new blocks since April
„First discoveries in new eastern offshore blocks since 2008
Hardy Oil, partner of Reliance Industries (RIL) in deepwater block KG D9, has
reported the first gas discovery in KG D9. Its commerciality is being ascertained. In
April 2011, RIL had also reported a gas and condensate discovery in the first well
drilled in deepwater block CY-PR-DWN-2001/3 (Cauvery-Palar basin). These are
RIL’s first discoveries in new blocks in the eastern offshore region since February
2008 (KG D3). If these discoveries prove to be commercial and significant in size, it
will help re-rate RIL’s E&P. RIL has 22 blocks in the eastern offshore region. It has
now drilled in 10 and made discoveries in 9. The first well in Mahanadi D4 (reserve
potential 100tcf) may be drilled in FY12. We retain our Buy rating.
Discovery just 7% of risked prospective resources in KG D9
The initial estimate of unrisked prospective resources in KG D9 was 54.8tcf
(risked 10.6tcf). After the first well drilled in Oct. 2009 was dry, the independent
expert-certified prospective resources estimate was cut to 29.5tcf (risked 5.2tcf).
After the second unsuccessful well in January 2011, estimates were further cut to
27.6tcf (risked 4.7tcf). The successful well is in a prospect (A2) that accounts for
just 7% (345bcf) of the risked prospective resources of 4.7tcf in KG D9.
Clarity on KG D6 2P reserve cut soon; 2C may rise
On June 13, Niko Resources (Niko) said that its 2P reserves had been cut by 18%
(no asset wise break-up). Clarity is expected on June 24. We have already cut 2P
reserves in KG D6 by 600bcfe, but the worst-case cut could be 2.7tcfe. The
impact of the cut on RIL’s NPV would be relatively low, as, at peak, the govt’s
share of profit petroleum in KG D6 is 85%. Also, 2C contingent resources (7.2tcf)
in KG D6 may rise, as the 2C number reflects only 14 of the 20 discoveries made.
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